Name of the Project
Mbeya coal-to-power project (MCPP).

Location
Tanzania.

Client
Kibo Mining.

Project Description
The integrated bankable feasibility study (IBFS) on the MCPP has concluded that the MCPP is financially, technically and operationally a very robust project.

The IBFS comprises an integration of the definitive mining feasibility study (DMFS), the definitive power feasibility study (DPFS), the integrated financial model for the MCPP and all the other relevant technical studies on the MCPP to date.

The MCPP comprises a 122-million-tonne coal resource, of which 85.9% qualifies for inclusion in any future reserve statement. Of this, 39-million tonnes is included in the pit design and is sufficient to satisfy the required indicative coal requirement of 39-million tonnes for 30 years.

It has been proven that constant coal production over the total life-of-mine can be achieved.

The mining method developed for the Mbeya coal mine has been confirmed as modified terrace mining. Overburden will be removed using a free dig (truck-and-shovel) method, with coal seam and interburden mining using mechanised continuous surface mining. The DPFS has concluded that the power plant, which will be 250 MW to 350 MW, will require coal with a calorific value of 12.85 GJ/t.

Net power that will be generated has been estimated at 1 840 GWh/y.

Average coal and limestone consumption has been estimated at 1 497 432 t/y (as fired) and 110 359 t/y respectively.

Jobs to be Created
Not stated.

Net Present Value/Internal Rate of Return
The MCPP DMFS estimates an internal rate of return of 69.2% with a payback of 2.4 years.

Value
The MCPP DMFS estimates a peak funding requirement of $17-million.

No new figures have been released in the DPFS.

Kibo Mining remains restricted in its ability to release certain detailed information relating to the IBFS, owing to the company’s being engaged in highly confidential discussions with various parties, including regulatory authorities.

Such  information is commercially sensitive and could result in a breach of Kibo’s confidentiality obligations, subsequently harming the company’s ability to successfully complete negotiations.

The most recent figures, released in the April 2016 DPFS, confirmed the total estimated project cost of the thermal power plant as below the cost estimate stated in the power prefeasibility study (PFS) released in 2014. The power PFS estimated the project’s total cost, depending on the plant option selected, at between $640-million and $760-million.

Duration
Not stated.

Latest Developments
There is accelerated momentum for the MCPP, with a fresh round of successful follow-up meetings with government departments and other Tanzanian stakeholders concluded, Kibo Mining has reported.

Kibo, along with the Tanzania Electric Supply Company, has received official instruction by the Tanzanian Ministry of Energy and Minerals to prepare a final memorandum of understanding that will govern the further development of the MCPP and the power purchase agreement (PPA).

“Development of the MCPP is advancing on all levels and we are optimistic that this trend will persist going forward,” Kibo Mining CEO Louis Coetzee has said in an update to shareholders.

The PPA is expected to be submitted to the Attorney General for review within the next few days.

Further high-level workshops and meetings will take place over the course of this month as part of the ongoing priority development schedule for the MCPP.

The completion of the Mbeya coal special mining right application and the environmental certification of the Mbeya coal mine and Mbeya power plant, remains on course.

On the back of the latest progress made in the further development of the MCPP, several formal expressions of interest have been received from internationally recognised infrastructure investors, expressing interest in making equity investments in the MCPP.

Key Contracts and Suppliers
Sepeco III (engineering, procurement and construction contractor) and GE (equipment, technology and services).

On Budget and on Time?
Not stated.

Contact Details for Project Information
Kibo Mining, tel +353 91 865367, fax +353 91 755066 or email info@kibomining.com.